day 25 of trial in your defense
of a multimillion-dollar “bet
the farm” case. You are defending the
cross-examination of your company’s pivotal witness, its former CEO, whose conduct
gave rise to the plaintiff’s claims.
Out of the blue, plaintiff’s counsel insists,
during his cross-examination of the former
CEO, that he is entitled to discover the
substance of all communications the former
CEO had with you, the company’s defense
counsel, after the CEO left the company.
You object, presuming that all of your communications with a former senior-level employee are protected by the attorney–client
privilege.
As luck would have it, there is a break in
testimony before the court addresses the
issue, and you hurriedly attempt to confirm
your suspicions that the privilege applies to
former as well as current company employees. You are surprised to learn there is no
bright-line rule in Arizona that says counsel’s communications with a former employee of his client are protected from disclosure, although there is substantial case law
from other jurisdictions suggesting that such
communications should be protected.
This article demonstrates why counsel’s
communications with a key former employee generally will be protected, and why.
The Attorney–Client
Privilege Under Upjohn
In Arizona, the attorney–client privilege
applies to confidential communications between counsel and client made for the purpose of securing or rendering legal advice. 1
But determining the identity of the client is
BY MARC R. LIEBERMAN & ANDREW L. MCNICHOL
He Doesn’t Work
Here Anymore
Are Our
Communications With
Him Still Privileged?
not always as simple as it appears. When the
client is a natural person, application of
the privilege is relatively straightforward: It
applies to communications between the individual and the attorney and no others. But
when the client is a corporation, governmental entity, or other organization, application of the attorney–client privilege is more
muddled. A corporation, as a legal fiction,
has no mouth or ears and can only “speak”
or “hear” through its agents, officers, and
employees. 2 Both state and federal courts
have struggled to create a definition of
the attorney–client privilege applicable to
organizational clients that is neither over-nor under-inclusive. Although a number of
courts initially adopted a “control group”
test, the U.S. Supreme Court, in Upjohn Co.
v. United States, 3 eschewed that test in favor
of a more functional test, which looks to the
nature of the communication rather than
the communicator.
Although Upjohn did not address wheth-
er communications with former employees
may be privileged, in his concurring opinion,
Chief Justice Burger asserted that:
a communication is privileged at least
when, as here, an employee or for-
mer employee speaks at the direction
of the management with an attorney
regarding conduct or proposed conduct
within the scope of employment. The
attorney must be one authorized by
the management to inquire into the
subject and must be seeking information
to assist counsel in performing any of
the following functions: (a) evaluating
whether the employee’s conduct has
bound or would bind the corporation;
(b) assessing the legal consequences, if
any, of that conduct; or (c) formulating
appropriate legal responses to actions
that have been or may be taken by
others with regard to that conduct. 4
Arizona Supreme Court
Adopts Upjohn
In Samaritan Foundation v. Goodfarb, 5 the
Arizona Supreme Court adopted Upjohn’s
functional approach to the attorney–client
privilege. The relevant inquiry, under
Samaritan, as to whether communications between corporate employees and counsel for
the corporation are privileged is the nature
and purpose of the communication rather
than the identity or position of the corporate employee. Following Samaritan, communications between corporate counsel and
It’s
